According to official news released by the U.S. Securities and Exchange Commission (SEC), 17 individuals have been indicted for allegedly running a cryptocurrency Ponzi scheme that defrauded thousands of Latino investors in the United States of approximately $300 million.

According to an official release from the regulator, the alleged fraudsters operated out of a company called CryptoFX LLC, which is headquartered in Houston, Texas.

SEC charges 17 people with cryptocurrency fraud

The SEC complaint accuses CryptoFX’s two main operators, Mauricio Chavez and Giorgio Benvenuto, of targeting more than 40,000 predominantly Latino investors in the United States through a Ponzi scheme.

From May 2020 to October 2022, CryptoFX pretended to be a platform for trading crypto assets and the foreign exchange market, and the 17 people charged served as leaders of the network. The leaders, who hail from Texas, California, Louisiana, Illinois and Florida, solicit investments from victims, promising returns ranging from 15% to 100%.

Through the Ponzi scheme, the scammers raised $300 million to support their lifestyle. They were not trading cryptocurrencies and forex as claimed, but were using the funds to pay purported returns to other investors, as well as pay their own commissions and bonuses.

Gurbir S. Grewal, Director of the SEC’s Enforcement Division, commented on the case: “We allege that CryptoFX was a $300 million Ponzi scheme that targeted Latino investors with promises of ‘risk-free’ and ‘guaranteed’ crypto and FX investments. , promising them financial freedom and life-changing wealth.”

SEC seeks disgorgement and civil penalties

In addition, after the court ordered to stop CryptoFX in September 2022, the two defendants, Gabriel and Dulce Ochoa, continued to solicit investments from victims. Gabriel had asked two investors to file a complaint with the SEC to recover their investments. Another defendant, Maria Saravia, claimed the SEC lawsuit was bogus when investors began expressing concerns.

While some defendants have agreed to accept final judgments without admitting or denying the charges, the SEC is seeking permanent injunctions, disgorgement and prejudgment interest and civil penalties against others.

Grewal added: “Ultimately, the only thing CryptoFX guarantees is thousands of victims spread across ten states and two foreign countries. A scam of this scale requires many players, and as our actions today demonstrate, we Not only will the key masterminds of these massive scams be held accountable, but all those who furthered their fraud by illegally recruiting victims will be held accountable." #SEC #加密骗局